The lack of human B lymphocyte development in beige/nude/XID (bnx) mice is in sharp contrast to the robust development observed in another immune deficient strain, the NOD/SCID mouse. The ability to generate human B lymphocytes in the NOD/SCID, but not bnx mouse has been hypothesized to be caused by differences in the microenvironments or systemic cytokine concentrations. In the current studies we report that the differences in development can be primarily attributed to the source of the progenitors transplanted into the mice. The prior studies in bnx mice used cultured pediatric or adult bone marrow (BM) as the source of the CD34+ cells, whereas the NOD/SCID studies have predominantly used fresh or cultured umbilical cord blood (UCB). We have analyzed BM and UCB for the number of human CD34+/CD38- cells capable of in vitro B lymphocyte development, and have found a lower frequency of B lymphocyte generation in BM. The individual B lymphocyte clones that developed from bone marrow produced 100-fold fewer cells than the UCB-derived clones. In agreement with the in vitro studies, human B lymphocytes developed in bnx mice from both CD34+ and CD34+/CD38- cells isolated from human umbilical cord blood, but not from equivalent numbers of CD34+ and CD34+/CD38- progenitors from bone marrow. Therefore, the lower generative capacity, and frequency of B lymphocyte precursors in human marrow may be responsible for the previous results that showed a lack of B lymphocyte development in bnx mice.